Mirror

With the 2006-2007 winter now mostly in the rear-view mirror, traders and meteorologists alike are turning their attention to what kind of temperatures spring will bring to the United States. According to Andover, MA-based WSI Corp., the April through June forecast is expected to average warmer than normal in all locations except for the Pacific Coast states, which could start the natural gas storage injection season sooner than normal, but push electricity loads high enough in June to be bullish for power prices in the Midwest markets.

With the 2006-2007 winter now mostly in the rear-view mirror, traders and meteorologists alike are turning their attention to what kind of temperatures spring will bring to the United States. According to Andover, MA-based WSI Corp., the April through June forecast is expected to average warmer than normal in all locations except for the Pacific Coast states, which could start the natural gas storage injection season sooner than normal, but push electricity loads high enough in June to be bullish for power prices in the Midwest markets.

With the extreme heat that has cooked much of North America over the past three weeks now in the market’s rear-view mirror and Tropical Depression Chris having faded into oblivion over Cuba during the weekend, most of the cash market continued to drop Monday. But several Rockies/Pacific Northwest/San Juan-Permian ranged from flat to about 60 cents in response to a total shutdown of the Opal (WY) Plant for Tuesday’s gas day (see Daily GPI, July 17).

With Hurricane Wilma firmly in the rear view mirror with no harm to Gulf of Mexico oil and gas infrastructure, November natural gas on Monday failed to push lower, leading some to believe the premium built into the market might already have been taken out. The prompt month ended up settling at $13.004, 13.2 cents higher on the day.

Neglecting fundamentals and running with technicals alone, the Nymex June natural gas futures contract ceased its flirting with the psychological $6 mark on Monday by barreling through it — setting a new June high of $6.25. The contract backed off slightly in late afternoon trading to close at $6.231, up a whopping 36.9 cents on the day and 12.1 cents over the previous June high of $6.11.

Within hours of the Senate voting out Democrat-crafted broad energy legislation late Thursday, Republican leaders vowed to make significant changes to tailor the bill to fit their views on energy issues, while Democrats warned they may filibuster a bill that emerges from conference committee radically altered.

Wednesday’s swing market was almost a mirror image of the previous day. This time single-digit declines dominated the price table instead of the increases by largely similar amounts recorded on Tuesday. One trader said the mild softness on Wednesday is what he actually had expected for both days.

ConocoPhillips’ upstream unit, comprised of crude oil, natural gas and natural gas liquids production on a boe/d basis, is expected to be near first quarter levels, the company said last week in an interim second quarter report. While the results benefited from a full quarter’s output from Venezuela facilities and new wells coming online in China, the gains were offset by normal seasonal declines in Alaska, Norway and the United Kingdom.

ConocoPhillips’ upstream unit, comprised of crude oil, natural gas and natural gas liquids production on a boe/d basis, is expected to be near first quarter levels, the company said Wednesday in an interim report. While the results benefited from a full quarter’s output from Venezuela facilities and new wells coming online in China, the gains were offset by normal seasonal declines in Alaska, Norway and the United Kingdom.